The Iowa state legislature is moving forward with a bill that
would create the first U.S. feed-in tariff specifically for wind
generation. If the bill is enacted, Iowa would join Vermont, and
the cities of
Los Angeles, and Gainesville, Florida as the U.S. jurisdictions
currently offering a feed-in tariff. While it may seem like
investors need little inducement to invest in wind capacity in
Iowa, which already ranks third in wind capacity among U.S. states,
the new incentive is aimed at mid-sized facilities, a neglected
market in that state.
Under a feed-in tariff, a utility sets a long-term price for
renewably generated electricity. A feed-in-tariff benefits
generators by providing a standard offer contract and favorable
rates, often based on a generous estimate of production
costs. Feed-in tariffs are generally credited as one of the
main reasons for large increases in renewable generation in several
European countries. In the U.S., feed-in tariffs have been
less
